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In A Franchise, When Does The Money Start Rolling In?

In A Franchise, When Does The Money Start Rolling In?

By FranchiseKing, Guest Blogger
Published: February 18, 2014 Updated: September 13, 2016

You need to know how long it’s going to take to start recouping your investment in the franchise concept you’ve chosen. You certainly shouldn’t have to guess how long it’s going to take for you to see some green.

If you’d like to find out when the money will start rolling in, keep reading. I’m going to show you how to get that money question answered.

Open For Business

The day you open your franchise business up, you should see some money rolling in.

That day…Grand Opening Day should be a day to remember, especially if the marketing department at franchise headquarters did its job. Customers should be everywhere. Wallets should be out. Money should be rolling in. And, when word gets out that there’s a new business in town, you should see a good amount of foot traffic (if it’s a retail or food franchise) going in and out of your new business.

Money will be flowing in. It will feel good. You’ll feel like a million bucks. Enjoy that feeling. Savor it like a fine wine or a corn-fed steak.

The Money Can’t Roll Into Your Pocket Yet   

The money that’s rolling into your new business can’t go into your pocket. Not yet. It needs to go back into your business. You’ll have expenses to cover…things like rent, inventory, advertising and utilities. Of course there’s payroll. And don’t forget that you have to repay the small business loan you received.

That probably won’t leave much…and it’s not supposed to. You own a brand-new business…a startup business. Before you can pocket some of the money that will be coming in, you need to get your franchise business to break-even.* That should be your short-term goal.

What Is Break-Even?

That’s the point in which your revenue pays your business expenses. Only then can you start thinking about pocketing some of the money that’s coming in.

But, you knew that.

That’s because you took the time to write a proper business plan. One that included your sales forecast. A good business plan will include projections. You’ll have an idea of when you’ll be breaking even, what your sales will have to be to get there.   

Franchise Ownership Is A Long-Term Thing

You’ve got to be in it for the long haul.

If you’re looking to replace your salary quickly, it probably won’t happen. You’re going to have to be patient. Your family will have to be patient too. Hopefully, you’ve set aside some funds to get you through those first few months…or longer.

I know you want to see the money rolling in.

Choose a franchise that’s a good match for your skills. Make sure it’s well within your means. Talk to a lot of existing franchisees, and chose one or two to visit in-person. Write a formal business plan. Consult with a franchise attorney.

If you do enough right things, the money may well roll in.

I’m pulling for you.

*Non-US Government link 


About the Author:

Joel Libava

Guest Blogger

The Franchise King®, Joel Libava, is the author of Become a Franchise Owner! and recently launched Franchise Business University.